General Motors
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GM Wins $1.9B from LG for EV Battery Defects

Oct. 12, 2021
General Motors’ technology partner will cover most of the costs associated with the recall of Chevy Bolts to correct the causes of lithium-ion battery fires.

General Motors announced a settlement agreement with LG Electronics Inc. by which the Korean group will reimburse GM for up to $1.9 billion of the total $2 billion costs associated with the recall of Chevrolet Bolt EVs and EUVs, due to manufacturing defects in battery modules supplied by LG.

“LG is a valued and respected supplier to GM, and we are pleased to reach this agreement,” stated Shilpan Amin, GM vice president, Global Purchasing and Supply Chain. “Our engineering and manufacturing teams continue to collaborate to accelerate production of new battery modules and we expect to begin repairing customer vehicles this month.”

GM has sourced lithium-ion battery modules for its Chevy Bolt series since 2016, and the two companies are partners in a joint venture, Ultium Cells LLC, that will produce battery cells to power the range of new EVs the automaker has pledge to introduce beginning in 2025.

However, starting in November 2020, GM began a recall of 2017-2019 Chevy Bolts due to a number of battery fires. In May 2021, GM said it would install new software on those affected models (and all new models) to help prevent future fires. More fires were reported after the new software had been installed.

In August, GM expanded the recall to include 2019, 2020, 2021, and 2022 Bolts and Bolt EUVs.

By that time, GM said it identified the cause of the battery fires as two separate, manufacturing defects: 1) a torn anode and 2) a folded separator, both of which must be present in the same battery cell in order for the fire to take place. Those problems occurred at LG Battery Solution’s plants in South Korea and Michigan.

Production of the LG battery modules was suspended in August to correct the causes of the defects, and then resumed in mid-September.

However, in identifying the battery as the cause of the fires, GM in August was forced to suspend assembly for the 2022 Chevrolet Bolt passenger cars and Bolt EUV sport-utility vehicles.

Assembly of the Chevy Bolts was scheduled to resume October 11.